Heidelberg & Masterwork joint venture factory in Tianjin

Heidelberg grows in its biggest market – China

Masterwork's president Li Li speaks about the new factory in Tianjin at the Heidelberg Innovation Week in end October 2020 Screenshot IPP
Masterwork's president Li Li speaks about the new factory in Tianjin at the Heidelberg Innovation Week in end October 2020 Screenshot IPP

A press release dated 2 December 2020 reveals that Heidelberg is strengthening its partnership with Tianjin China based converting equipment manufacturer Masterwork. The two companies have expanded their strategic cooperation by setting up a production joint venture at Masterwork’s 328-acre site in Tianjin. The new automated plant is to contain an intelligent printing equipment production line.

The new Masterwork 268 acre site in Tianjin where the highly automated joint venture Heidelberg Masterwork production plant is being built Screenshot IPP
The new Masterwork 268 acre site in Tianjin where the highly automated joint venture Heidelberg Masterwork production plant is being built Screenshot IPP

The two companies also expect to expand their strategic cooperation through joint parts production by the joint venture to open up substantial opportunities for boosting efficiency, particularly at Heidelberg’s production site in Qingpu, about an hour from Shanghai. “The manufacturing joint venture with Masterwork is a further milestone in the successful cooperation between the two companies and opens up additional opportunities for Heidelberg in China,” said Rainer Hundsdörfer, CEO of Heidelberg.

“With a sales volume of around Euro 300 million, China is Heidelberg’s most important single market in the graphic arts industry. We have increasingly strengthened our leading market position by expanding our range of products at our production site near Shanghai. The increasing purchase of locally manufactured parts will significantly increase our competitiveness in this growth market.”

Under the terms of the cooperation agreement, the joint venture will take over some of the machine parts previously manufactured by Heidelberg. The main customers are the Heidelberg Graphics Equipment plant in Qingpu (Shanghai) and Masterwork and its affiliated companies. Production is scheduled to start at Masterwork’s new Tianjin site at the beginning of 2021.

“The joint venture between MK and Heidelberg is a very important step in both sides’ strategic development. Our common goal is to provide high-quality, cost-effective, and intelligent products for the market to better meet and service customer needs,” says Masterwork president Li Li. “Through this cooperation, the joint venture will introduce the most advanced management, production, and manufacturing technologies, all of which are based on Industry 4.0. In addition, various processing centers representing the world’s most advanced level will also be put into use in the joint venture to ensure the best performance and maintain the same high-quality standards as Heidelberg. We firmly believe that the joint venture will live up to the expectations, especially the quality requirements. Finally, we are very happy with this cooperation. By learning from Heidelberg, Masterwork will surely upgrade to a new and higher level of manufacturing and production skills worldwide.”

Around 900 Heidelberg employees work in China, of which 450 are in sales and service. This puts Heidelberg in an excellent position to take advantage of growth opportunities in China and Asia in the future and to further develop and secure these markets for Heidelberg. Two branches in Beijing and Hong Kong and three offices in Guangzhou, Shanghai, and Shenzhen ensure comprehensive customer support on-site.

Aiming for the packaging printing market

Together with Masterwork, China’s largest manufacturer of die cutters and hot foil embossing presses and a long-standing sales partner, Heidelberg also aims to significantly expand its market position in the growing packaging printing sector. At the Qingpu factory, Heidelberg has expanded the manufacture of its SM and CD machines by gradually making longer and more complex machines. The newly designed, slightly smaller than B1 CS presses, are made only in Qingpu and have been a success with commercial printers in Asia and worldwide.

The alliance between the companies in 2014 started with Heidelberg marketing Masterwork’s die-cutters, and there was some transfer of know-how from Heidelberg on converting equipment including folder-gluers. Even then, there was a provision to extend the joint venture on finishing equipment into parts and press production. In early 2019, Masterwork obtained 8.5% of Heidelberg shares after its capital increase decided by its board in March 2019. Masterwork, as a strategic anchor shareholder, owns approximately 8.5% of Heidelberg shares, a figure similar to that of its other anchor investor Ferdinand Reuesch – making them the two anchor shareholders in the company.

2023 promises an interesting ride for print in India

Indian Printer and Publisher founded in 1979 is the oldest B2B trade publication in the multi-platform and multi-channel IPPGroup. While the print and packaging industries have been resilient in the past 33 months since the pandemic lockdown of 25 March 2020, the commercial printing and newspaper industries have yet to recover their pre-Covid trajectory.

The fragmented commercial printing industry faces substantial challenges as does the newspaper industry. While digital short-run printing and the signage industry seem to be recovering a bit faster, ultimately their growth will also be moderated by the progress of the overall economy. On the other hand book printing exports are doing well but they too face several supply-chain and logistics challenges.

The price of publication papers including newsprint has been high in the past year while availability is diminished by several mills shutting down their publication paper and newsprint machines in the past four years. Indian paper mills are also exporting many types of paper and have raised prices for Indian printers. To some extent, this has helped in the recovery of the digital printing industry with its on-demand short-run and low-wastage paradigm.

Ultimately digital print and other digital channels will help print grow in a country where we are still far behind in our paper and print consumption and where digital is a leapfrog technology that will only increase the demand for print in the foreseeable future. For instance, there is no alternative to a rise in textbook consumption but this segment will only reach normality in the next financial year beginning on 1 April 2023.

Thus while the new normal is a moving target and many commercial printers look to diversification, we believe that our target audiences may shift and change. Like them, we will also have to adapt with agility to keep up with their business and technical information needs.

Our 2023 media kit is ready, and it is the right time to take stock and reconnect with your potential markets and customers. Print is the glue for the growth of liberal education, new industry, and an emerging economy. We seek your participation in what promises to be an interesting ride.

– Naresh Khanna

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